Property debt investment fund targets 6% yield

Intermediate Capital is targeting a yield of 6% from an investment company specialising in UK commercial property debt launched through its subsidiary ICG-Longbow.

The ICG-Longbow Senior Secure UK Property Debt Investments fund will aim to raise £100 million through an initial public offering on the London Stock Exchange and will be capped at £250 million.

The investment company is aiming to capitalise on estimates there will be a £44 billion shortfall in the supply of senior debt in the UK commercial property sector. It will make new individual loans with a maximum exposure of 65% loan to property value.

The fund aims to be fully invested within six to nine months of launch as it strives to hit its yield target.

The chairman of ICG-Longbow, David Hunter, said in a statement, ‘This new vehicle will aim to provide investors with predictable and attractive target returns with minimal risk of income or capital loss.

He added: 'The team at ICG-Longbow has many years’ experience of investing in the UK commercial property debt market and we are excited at the opportunity to open up this expertise to a wider audience.’

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